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CHAPTER XXXV.

PROCEEDINGS TO FORFEIT FRANCHISES.

§ 953. Meaning and object.

954. Original office and form of the writ.

955. How regarded and employed at the present day.

956. Source of authority for writ.

957. When the exercise of a right becomes a franchise without a legislative

958.

declaration.

Franchises created by statute.

959. Life insurance by beneficial societies.

960. Statutory authority to exercise corporate powers and exemption from common law prohibition.

961. Not every privilege a franchise.

962. Remedies cannot be given effect of an injunction.

963. Statutory modifications of the remedy.

964. For what causes it will lie.

965. Questions involved in forfeitures.

966. Non-performance of conditions as a cause of forfeiture. 967.

Whether non-compliance ever lapses charter ipso facto.

968. Will lie for usurpation of corporate office.

969. Not a remedy for private wrongs.

970. What must appear to authorize the writ.

971. Entering into a trust" as partners.

972. Employment of the writ to protect the state from monopolies.

973. Traffic arrangements between railroads.

974. For entering into arrangement delegating special powers and corporate

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984.

Interference with federal authority no defence.

985. Usurpation, perversion and non-suer distinguished.

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§ 953. Meaning and object.—The writ quo warranto is of ancient origin, and while the form of process and judgment thereon have materially changed in modern times it is employed to accomplish substantially the same objects as when first used. It is, and always was, a mandate issuing from, or at the instance of, the sovereign against an individual or corporation requiring him or it to show (quo warranto) by what warrant or authority an office or franchise is claimed or exercised.1 Both words "office" and "franchise franchise" are here used so as to conform our definition to the wording of statutes defining, giving and prescribing the remedy. But when we examine the true principle or policy of sovereignty, the maintenance of which requires a resort to this remedy, we find that it lies in all cases where persons claim and exercise a privilege or immunity of a public nature without legislative authority. Both a franchise and an office fall within the terms of this definition.2

§ 954. Original office and form of the writ.-By the fiction of the feudal law the king was the fountain whence all franchises were derived; and if any individual or col

1 Blackstone defined quo warranto as it existed at common law as "A writ commanding the defendant to show by what warrant he exercised any franchises, having never had a grant of it or having forfeited it by neglect or abuse." 3 Bl. Com. 262; 23 Wend. 538, 577.

2 This is seen at once to be a very general and unsatisfactory description of the scope and office of the writ, but it is about as definite as is usually met with in the language of judges and text writers. It cannot be out of place, when we consider the constantly increasing number and importance of corporations as commercial factors and the more frequent occasions for a resort to the remedy as a consequence of such increase, to explain more fully and with particularity the grounds upon which the proceeding rests and the limits within which it should be confined.

lective body of men, whether corporate or not, exercised any such franchise without legal authority it was considered as an usurpation of the king's prerogative. If a franchise had been legally granted but was exercised in a manner inconsistent with the express or implied condition of the grant, the latter was considered forfeited and the king might resume it.

The manner by which either the original title to franchises was tried, or the forfeiture of them for subsequent misapplication was enforced, was by writ of quo warranto which was called the king's writ of right for franchises and liberties.1

If the defendant failed to appear within the time named in the writ, summary judgment by default was rendered against him; if he appeared and a trial was had the judgment was final for or against the king.2

The objects for which the writ was at first employed were salutary and commendable, as it checked monopolies created by tradesmen for purposes of oppression and extortion, and put a limit to usurpations by the nobility. But finally it came to be an instrument of corruption and was used for the accomplishment of unworthy and mercenary purposes.

Fines imposed upon corporate bodies and often upon corporators themselves became at one time a lucrative source of revenue.

In England the writ quo warranto has long since gone out of use and an information in the nature of quo warranto at the suit of the attorney-general has taken its place. The reason for this change as given by Blackstone was its great length and the fact that the judgment was final and conclusive even against the

crown.3

1 2 Kyd. on Corp. 395.

2 2 Kyd. on Corp. 495.

33 Blk. Com. 263.

The information in the nature of quo warranto was provided by statute 9, Anne, Ch. 20, and is criminal in its nature providing that in case any person shall be found guilty of the charges contained in the informa-. tion exhibited against him he shall not only be ousted from the office or franchise usurped, intruded into or unlawfully withheld, but fined in addition.1

955. How regarded and employed at the present day.— But in this country, as well as in England, at the present day, it is the main object of the proceeding and its effect when successful to either oust the defendant of the franchise if he failed to show in himself a complete legal right to exercise it derived from or under authority of the State, or if the franchise has once been legally granted and has been forfeited by the defendant, or those through whom he derives title to it, to seize it into the hands of the state.2

1 Attorney-General v. Utica Ins. Co., 2 Johns. Ch. 370; Rex v. Bennett, 1 Str. 101; Rex v. Jones, 8 Mod. 201. Prior to statutory modifications it was likewise governed by the principles and practice governing criminal procedure in this country. State v. Roe, 26 N. J. L. 215. People v. Jones, 18 Wend. (N. Y.) 601. The action was required to be prosecuted in the name of the "People" the "Commonwealth," etc., and to conclude "Against the peace and dignity of the State." Wight v. People, 15 Ill. 417; Scott v. Clark, 1 Iowa, 70. The writ could not be quashed by consent of the parties Rex v. Edgan, 4 Burr, 297. The common law procedure acts did not apply to the pleadings in this action Rex v. Seale, 5 El. and Bl. 1.

2 The proceeding is not amenable to objection under the provision of the Pennsylvania constitution, that "No person shall for any indictable offence be proceeded against criminally by information," the courts of that state having power to issue quo warranto as a civil remedy. Com. v. McCloskey, 2 Rawle, 369, 385. See also, State v. Lingo, 26 Mo. 496; Com. v. Birchett, 2 Va. Cas. 51; Ensuinger v. People, 47 Ill. 384. In Missouri it is regarded as a writ of right, issuing of course on demand of the proper officers. State v. Stone, 25 Mo. 555. In other states the courts have discretionary power upon affidavits or other preliminary showing to either grant or refuse the writ. See Comman v. Bridgewater Min. Co., 12 N. J. L. 84; State v. Lehre, 7 Rich. (S. C.) 234; Com. v. Cluley, 56 Pa. St. 270. This was also the practice in New York prior to the adoption of the Code of Civil Procedure. People v. Sweeting, 2 Johns. 184. In Vermont the right of the Supreme Court to issue the writ is recognized by the statute in general terms and the occasions for it are left to be determined by

The action, and the issues are strictly legal.1

§ 956. Source of authority for writ.-In England the sovereign authority by which these may be granted, is the crown, while with us it is the legislative department of the sovereign State representing the people. Whatever the act or conduct complained of, in order to justify a proceeding quo warranto it must amount in legal contemplation to an usurpation or abuse of functions which, unless granted to the citizen, remain a part and parcel of sovereign power. But the constituted State authorities cannot proceed against a citizen by quo warranto on account of the exercise of any constitutional right, however much its exercise may be a matter of public interest.

§ 957. When the exercise of a right becomes a franchise without a legislative declaration. When, therefore, even in the absence of a statutory prohibition, the exercise of a right becomes so far prejudicial to the private rights of others as to justify the judicial department in saying that public policy-by which is meant in that case the interest and well-being of the many as contradistinguished from one or a few-demands that it be not permitted, the meaning deducible from such decision is, that such right has become a franchise, a part of sovereign right.

Resort must in many cases be had to the common law in order to determine whether a right be common to all or exclusive and public in its nature, and hence a

common law rules. State v. Boston, etc., R. Co., 25 Vt. 433. While in England a new form of proceeding has been prescribed by secs. 146 et seq. of 15 & 16 Vict. Ch. 76, the same does not extend to informations in the nature of quo warranto in respect of which the fiat of the attorney-general must still be obtained according to the former practice. Reg. v. Seale, 1 Jur. N. S. 593; 24 L. J. R.

1 People v. Albany, etc., R. Co., 57 N. Y. 161.

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